Thinking of starting your own business in Korea? Dive into our guide that makes the intricate process of setting up a business in Korea, as a foreigner, more manageable and less daunting. If a foreigner is not a resident of South Korea, or if your company is a foreign business entity, here’s the guide to how to set up the business in Korea. We provide the 1stop service from the beginning of the forming business entities to the completion of the setup, accounting services after, plus immigration issues. Some procedures may be skipped or unnecessary depending on what form of business you are setting up in Korea. You can consult with our Investment, Business lawyer. A foreigner who’s not a resident of Korea can incorporate a new Korean company with an investment of more than 100 million KRW equivalency of foreign currency. By doing so, you can establish a local corporation in Korea. The Liaison office is not considered a business entity, a foreign company can establish it for non-sales activities, such as research, development, after-sale services, etc. Since the Liaison office doesn’t do sales activities, business registration or license is not issued. Other than some foreign direct investment-related steps, the procedures of incorporation are applied to foreigners basically the same as to Koreans. Normally incorporation itself takes about 1-2 weeks. Incorporation is a court process, and it takes about 1 week. In Korea, we have 5 different legal forms of companies: Stock company, Limited company, Limited Liability Company, Limited Partnership Company, and Partnership company. The most common type of corporation is a Stock company or a Joint one. The major differences between a Stock company and a Limited company are Transfer of capital, Issuance of bonds, Board of directors, Number of directors requirement, Number of auditors, etc. There is no minimum investment amount requirement for both, if it’s not planned to register as FDI company. In general, FDI means 100 million KRW or more investment made by foreigners. FDI company refers to a company at least 10% or more of the voting stocks issued to a foreign investor and at least 10% of the total investment amount should be made by foreign investors. If neither of the requirements is satisfied, the appointment of an executive member who holds voting rights in major decision-making, etc. of the company is needed. There is the acquisition of stocks of domestic companies, 5 years or more of long-term loans from mother companies overseas, and investments in non-profit corporations in science and technology. Objects of investment to acquire shares, foreign currency, capital, goods, industrial property rights, etc. The FDI process is a part of the Business setup in Korea. Notification of foreign direct investment to the Foreign Exchange Bank of Korea is required. The bank will issue an FDI account to receive funds if it’s for a newly created local company. And after incorporation and business registration are finished, funds arrived in the FDI account into a new company’s bank account. Registration of the FDI company can be done within 1-3 days in the bank where the company’s account is. Korean government promotes foreign investment, governing FDI companies through Foreign Investment Promotion Act, Special Taxation Act, providing tax benefits, etc. When a foreigner created a new business entity in Korea, it should be registered with the tax office. If it’s a corporation, it can be done after the incorporation process in court. With the business registration certificate, a foreigner can open an account for a business. If it’s a new local company, the invested funds shall be transferred to a new company’s account as capital money. A person who desires to engage in the administrative management of a foreign investment company prescribed by the “Foreign Investment Promotion Act” can be eligible for a D-8 visa. A foreigner who properly reports the FDI notification and meets the requirement of being recognized as a person who made an FDI can apply. D8 is a long-term visa, also known as a Korean entrepreneur visa, or Investor visa, which grants permanent resident status(F5 visa) after 5 years of holding. Our lawyers provide a one-stop service for businesses set up in Korea. Since it has many concerning steps, we highly recommend you get a lawyer. Our services are not limited to a few or part of the steps of business formation, such as company incorporation or business registration. We are involved in all aspects of setting up a business in Korea, including obtaining additional permits to properly conduct your business, finding, and managing office leases, obtaining visas for staff, etc. Especially when you’re overseas, setting up your business in Korea will be much more accessible and easier when you have attorneys to handle it on your behalf. A1: It depends on whether you’re a resident or not in Korea. In most cases, the first step is reporting or notifying a foreign direct investment to the Korean authorities. A2: Basically, a Private business or Corporate. If you’re a non-resident foreigner in Korea, a private business is not an option. Foreigners as a individual or as a foreign company can establish a Korean corporation, a branch office, or a liaison office in Korea. A3: An FDI company refers to a company with at least 10% or more of the voting stocks issued to a foreign investor and at least 10% of the total investment amount made by foreign investors. A4: The D-8 visa is a long-term visa for foreigners engaged in the administrative management of a foreign investment company(FDI) in Korea. A5: A local lawyer can provide comprehensive services for business setup, including company incorporation, business registration, obtaining additional permits, managing office leases, and obtaining visas for staff. A6: In Korea, foreigners can establish a Stock company, Limited company, Limited Liability Company, Limited Partnership Company, or a Partnership company. A7: The FDI process involves notifying the Foreign Exchange Bank of Korea, opening an FDI account, remitting investment funds, incorporation, business registration, and finally transferring the funds to the new company’s bank account.